NEWSFLASH

---

INVESTORS EXPECT P28.25 RATE BY YEAREND

Manila, Nov. 3, 1997 - Peregrine Securities expects the peso to bounce back to P28.25 by yearend, as overseas workers' holiday remittances come in to beef up international reserves.

Peregrine is the first among stockbrokerage and investment companies to come up with an upbeat forecast for the peso after it was allowed to depreciate last July. Bankers earlier predicted the exchange rate to settle at P30-P32 by yearend.

Peregrine said the peso rebound will be helped by prudent government policies, keeping the budget in surplus,, safeguarding the banking system and allowing market forces to operate.

It said that next year's growth will be greatly influenced by two major factors: the national elections threatening political stability and the El Nino-related drought which poses danger of food shortage and higher prices of agricultural products.

The investment house lauded the country's circumspect economic policy. "Policy makers have made the appropriate adjustments for the sudden economic turbulence in the region," the report said. "Fiscal policy not only continues to be prudent, but the tax reform seems to be on track."

The national government fiscal position remained at a surplus while the third and crucial revenue-gaining component of the Comprehensive Tax Reform Package has been decided by the bicameral committee. The country expects to exit from the International Monetary Fund aid in November.

---